Correlation Between AdvisorShares STAR and Amplify Cash
Can any of the company-specific risk be diversified away by investing in both AdvisorShares STAR and Amplify Cash at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining AdvisorShares STAR and Amplify Cash into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AdvisorShares STAR Global and Amplify Cash Flow, you can compare the effects of market volatilities on AdvisorShares STAR and Amplify Cash and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in AdvisorShares STAR with a short position of Amplify Cash. Check out your portfolio center. Please also check ongoing floating volatility patterns of AdvisorShares STAR and Amplify Cash.
Diversification Opportunities for AdvisorShares STAR and Amplify Cash
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AdvisorShares and Amplify is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding AdvisorShares STAR Global and Amplify Cash Flow in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify Cash Flow and AdvisorShares STAR is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on AdvisorShares STAR Global are associated (or correlated) with Amplify Cash. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify Cash Flow has no effect on the direction of AdvisorShares STAR i.e., AdvisorShares STAR and Amplify Cash go up and down completely randomly.
Pair Corralation between AdvisorShares STAR and Amplify Cash
Given the investment horizon of 90 days AdvisorShares STAR Global is expected to generate 0.63 times more return on investment than Amplify Cash. However, AdvisorShares STAR Global is 1.58 times less risky than Amplify Cash. It trades about 0.08 of its potential returns per unit of risk. Amplify Cash Flow is currently generating about 0.05 per unit of risk. If you would invest 3,926 in AdvisorShares STAR Global on November 3, 2024 and sell it today you would earn a total of 479.00 from holding AdvisorShares STAR Global or generate 12.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
AdvisorShares STAR Global vs. Amplify Cash Flow
Performance |
| Timeline |
| AdvisorShares STAR Global |
| Amplify Cash Flow |
AdvisorShares STAR and Amplify Cash Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AdvisorShares STAR and Amplify Cash
The main advantage of trading using opposite AdvisorShares STAR and Amplify Cash positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AdvisorShares STAR position performs unexpectedly, Amplify Cash can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Amplify Cash will offset losses from the drop in Amplify Cash's long position.| AdvisorShares STAR vs. AdvisorShares Dorsey Wright | AdvisorShares STAR vs. Vident Core Bond | AdvisorShares STAR vs. WBI BullBear Quality | AdvisorShares STAR vs. WBI BullBear Value |
| Amplify Cash vs. Global X Dow | Amplify Cash vs. AdvisorShares STAR Global | Amplify Cash vs. Global X Funds | Amplify Cash vs. FT Vest Dow |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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